Thanks to Karen for letting me know about this new restaurant newly opened in Arco da Calheta, and sending a few photos.
New restaurant opened just over a week ago. It is located on the steep road to Paul da Serra that goes up from Loreto. The cattery /kennels is on the right and this is a bit further up on the left. They have a Facebook Page. We visited twice last week. Really good, very traditional dishes on menu, and things like lamb that you don’t always see.